Forex traders seemed to be sleeping in on a Monday, as price action was relatively subdued. Either that or everyone was just busy watching the freshly-released star-studded “Bad Blood” music video by T-Swizzle and trying to guess which female pop star she’s referring to…

There was no guesswork involved in the latest set of economic reports from Japan, which were mostly guilty in driving the yen lower against its counterparts. The March industrial production figure was revised to show a steeper 0.8% decline from the initially reported 0.3% drop while tertiary industry activity chalked up a 1.0% tumble, twice as much as the projected 0.5% dip. The only positive news from Japan was the stronger than expected 2.9% gain in core machinery orders for March, which outpaced the consensus of a 1.7% increase.

USD/JPY is up 29 pips (+0.25%) and is trading above 119.50, EUR/JPY is 15 pips higher (+0.11%) and closing in on the 137.00 handle, and GBP/JPY is enjoying a 28-pip gain (+0.17%) just within a stone’s throw away from the 188.00 mark.

Australia had its share of bad blood – I mean, bad data – as the economy printed a 1.5% decline in new motor vehicle sales for April. This was followed by a downbeat speech from RBA Deputy Governor Philip Lowe who said that the central bank has scope to lower rates further if needed.

AUD/USD is slightly lower after Lowe’s testimony and is facing a 10-pip loss (-0.12%) while AUD/JPY was able to take advantage of yen weakness and hold on to a 12-pip gain (+0.13%) right on the 96.00 handle.

Only a couple of minor reports, namely the Swiss retail sales figure and the Italian trade balance, are lined up in the forex schedule for today’s London trading session. Be on the lookout for any strong reactions to FOMC member Charles Evans’ testimony today, as he touched upon the importance of exercising caution in normalizing monetary policy.

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